Wide Range Bodies or 'big' candles

[waveslider 10]

Yep, It aint rocketscience, but it tells you where you are. If you combine multiple timeframes it might be more useful..

I have it on my screen and it serves as a decent filter to keep me from top/bottom picking. Maybe if I watch it longer it will give me more ideas..

[Anonymous 11]

..... I have done some testing and found that by counting the number of bullish WRBs compared to bearish WRBs you have a pretty good trend/bias filter. Spark any ideas?

 

Nice to have a new voice with us. Welcome. Thanks for posting.

 

One question: how do you determine a Bullish WRB from a Bearish one?

 

I have attached a chart that has a number of white (close>open) WRBs. But of the 4 shown (there are more), 2 are actually bearish in nature.

 

The first WRB on the left hand side has ultra high volume and supply entered the market on that candle. Hence I would say this is a bearish WRB.

 

The Next WRB is the best of all. While it is not large, it does engulf the previous candle and is Effort to Rise (VSA). In fact, a valid Engulfing pattern is formed. With this engulfing WRB within the body of the larger WRB, there would be a signal to get long.

 

The Next WRB is Large with Ultra High Volume as well. But this time, the market is pushing thru supply, hence the high volume. Where the first WRB was bearish because of high volume, this one is bullish because of high volume. Smart Money is willing to absorb the supply here, hence the high volume. If the Smart Money is willing to buy at higher prices, they must be expecting even higher prices.

 

The final WRB shown is another large white WRB. Here we do have Effort to Rise as seen in volume and close. But this time we end up with No result from an Effort to Rise. This is bearish. In fact, what can not be seen is a No Demand signal that comes within the body of this WRB which could of signaled a short trade after seeing the weakness of no results from an effort to rise.

 

So, I ask again, How are you determining the nature of the WRB? I hope you are using more than just open vs. close.

[waveslider 10]

HI Pivot,

 

As we both know, WRB is no silverbullet. As with any indicator, method, there are time when it is better to actually flip the system and do the opposite. So a bullish WRB (close above open for this example) could actually be a sell signal.

 

This little indicator does use close>open as a bullish indication, but it is nothing without the proper filters applied.

 

I enjoyed your analysis. And I agree, just using close > open as a bullish analysis is incorrect. However it can be use-able as is. Say you have a "bullish" WRB at the top as you did - this market could still be considered bullish and above support as long as price remained above the open of that bullish bar. In fact after the bar you showed at the top there, price was caught in a range, possibly preparing for a move higher? Possibly not.

 

If we can agree that WRBs (bullish or bearish) mark important support and resistance then maybe we can leave it at that and each use that info for what its worth.

 

What you are doing in your analysis is something that could not be replicated with a simple indicator. To me, indicators are only to grab attention and provide confirmation based on proven probabilities, I'm sure you would agree.

 

slider

[Anonymous 11]

Just found this a bit interesting.

 

First, there is a chart in the VSA thread that shows an entry set up into this market much earlier. This is later in the move to be sure, but none the less telling.

 

Check out the chart below.

 

There are two candles that constitute Effort to Fall. Effort to Fall means that the Smart Money wants to take prices down. They are interested in falling prices. As it happens, these two candles are also WRBs. WRB represent possible changes/shifts in supply and demand.

 

Notice that within the shaded area we have white hammer line. The next candle closes up, but on volume less than the previous two candles. And on a very narrow range. Plus, the volume is less than average. Simply, it is No Demand.

 

Now the interesting thing happens on the dark inverted hammer line.

 

Many people will say that the shadow on a candle means price rejection.

 

Take a look at it here. Note that the Long Shadow is as high as the high of the first WRB (effort to fall candle). In other words, price moved into an area of weakness (downside strength) and was rejected. Also note that the second WRB also covers a good deal of the Long Shadows depth.

 

If you were thinking the move is over, there is evidence to the contrary.

 

Kinda' cool how that worked out.

[brownsfan019 17]

Pivot - nice chart. Here's what I see - if you are short somewhere into that nice down move, you had about 2 WRB's that gave really nice exits.

 

You guys are taking WRB's into a the next level and for those like me that like to keep it simple, exiting based on visual WRB's is a clean, simple way to go. It's not perfect as I've explained here, but in a move like you've provided here, there's some nice cash made.

[Anonymous 11]

Pivot - nice chart. Here's what I see - if you are short somewhere into that nice down move, you had about 2 WRB's that gave really nice exits. .

 

B.F., you have mentioned this time and time again: there can be some issues as to which WRB is a good exit. That is, sometimes the first one does not make the "best" target as the market continues in the trade direction.

 

This is one reason I like the trailing stop method.

 

Now, one can create a "blackjack" concept if one understands MORE FULLY the wealth of information entailed with WRBs.

 

Take another look at that previous chart.

 

The two WRBs that represent "Effort to Fall" are good places to move a stop, but not exit. After these two WRBs, there is another even larger one with ultra high volume, this becomes the one to exit the position on.

 

Simply, if the WRB is an "Effort to Fall/Rise" one moves the stop to just below/above the low/high of the body. If the WRB is not an "Effort" type of WRB, exit on close. It's simple. It's concise. It's repeatable.

 

Also, I have tried to stress that WRBs make for good profit targets because they are market generated. And as market generated information, there is a lot going on within them. So much in fact, that as mere exit targets is to belie their overall power and importance. Said power and importance is of course why they make good exits, but it is not their only use, nor their best one.

[brownsfan019 17]

Pivot - I can appreciate your info and ideas on the subject. For me, as you know, in the spirit of keeping things simple, I just look for visual WRB's to exit on. I have not done nearly enough backtesting and research to be able to say when a WRB is a good exit point and when one is a good reason to stay in the trade. Perhaps you could detail each of those scenarios when time permits.

 

1) Under what conditions should a WRB be used to exit a trade?

 

2) Under what conditions should a WRB be used as a reason to stay in the current trade and not exit?

 

Also...

3) What is the backup plan when a WRB just does not appear, meanwhile the trade is moving in your direction?

[Anonymous 11]

 

1) Under what conditions should a WRB be used to exit a trade?

 

2) Under what conditions should a WRB be used as a reason to stay in the current trade and not exit?

 

3) What is the backup plan when a WRB just does not appear, meanwhile the trade is moving in your direction?

 

Good questions B.F.

 

First I would say the answers are a bit tricky. Don't get me wrong, I say tricky because you use constant volume charts. But here are some things I look at:

 

1. I like the concept of "Effort to rise/fall" from VSA coupled with WRBs. If a WRB is an Effort candle, then I move the stop to just below/above the open of the body.

 

2. If the candle is very large and has Ultra High Volume and is not an effort to rise/fall or pushing thru supply candle, then one would look to exit. This has to do with possible supply (selling) entering the market.

 

As previously stated, I do not exit at the WRB I always trail. But if I did exit, this would be the type of WRB that would trigger an exit rather than a moving of my stop.

 

I know you use Constant Volume Candles so things are different for you. You would have to focus on things such as:

 

1. Overall Price Action: both in the market traded and related markets

 

2. different time frames (or in this case, different constant volume levels).

 

3. What created the WRB? If already in when the news event comes out, you might want to exit on the WRB (initial reaction to the news) rather than use a trailing stop.

 

Mark is truly the one to answer this question. I hope he will add is input. I would just stress that there is a way to both use a trail and an exit strategy with WRB that is both simple and consistent.

 

As far as WRBs not showing up. Again, I use the definition of an WRB as a candle with a body that is greater than the three (3) prior intervals. Hence it is possible to have an WRB that does not look large but meets the definition. Simply, it is rare to have no WRB for a sustained period of time. Also note that in an extreme case where there are no good WRBs (visual as you like), then a Wide Spread Candle (WSC) could be used.

[brownsfan019 17]

Pivot - thank you for sharing once again. Maybe we can get Mark to come on over to this thread...

 

I may have mentioned this here (or not) but I have also been using time charts as well. Part of it has to do with the fact that each charting software interprets how to construct VBC's differently. MultiCharts has their own way, TS their own way, etc. While I think VBC's are a valid trade charting setup, there are limitations that I think are due to them not being as popular as a time or tick chart. So, just wanted to let you know that I am on a 5 minute ES chart as well, if that helps in using WRB's.

 

I'll be perfectly honest - I do not know a thing about VSA. While it may behoove me to learn more about it, I also do not want to open a can of worms... As I am sure you know, it's always tempting to learn about something new or different, but as soon as you dive into it, things change... and not always for the better.

 

I sole purpose of WRB's is to get better exits than what I was doing. And as long as they appear, this is the case. So, in regards to better exits, they have done just that. Now it's a matter of continuing to finetune them.

 

Knowing that I do have 5 minute charts up, if there's something else you can share, that would be great.

[brownsfan019 17]

Pivot - I have a question/favor to ask - if you have time, can you create a post on how to interpret WRB's as continuation vs. exiting points in a way that someone (like me) that knows nothing on VSA could understand and possibly put to work? I'll be up front - I really don't have a desire to learn VSA inside and out purely for this purpose. I'm just being honest. But perhaps you can take some of that knowledge and transpose it over in this thread for those of us that like WRB's, but not necessarily looking for a whole new ball of wax with VSA.

 

Part of the reason for this request is an ES trade from this morning. I'll post some screenshots here in a bit.

[brownsfan019 17]

Here's a couple charts from my ES trade this morning.

CHART ONE: HIGHLIGHTED IN YELLOW IS THE WRB EXIT THAT I EXITED ALL OF MY CONTRACTS ON.

 

CHART TWO: SHOWS AFTER 40 MIN'S OF CONSOLIDATION, ANOTHER BULLISH PUSH TO THE UPSIDE THAT *COULD* HAVE RESULTED IN ANOTHER 3 PTS IN MY FAVOR.

 

 

CHART THREE: THERE IS NO CHART THREE RIGHT NOW. WE'LL SEE WHAT HAPPENS WITH THE REST OF THE DAY AND IF THIS LONG (AT 1518.00 BY THE WAY) WAS A PHENOMENAL ENTRY THAT COULD HAVE YIELDED PROFIT ALL DAY OR IF THIS COULD HAVE BEEN A ONE OR TWO POP UP TRADE. TIME WILL TELL.

[BlowFish 10]

Any chance of posting those charts with volume?

 

Did you get another entry signal to get you long again? Then closing after the WRB would not have mattered too much.

 

Finally in answer to your question to PP the key things (IMO) are:-

 

1) Background strength weakness - not easy to determine without a 'full blown' VSA analysis.

 

2) S/R - are you in an area where you might expect a trend to end or pause? - nothing to do with VSA directly.

 

3) 'Climatic' volume. - you may be able to use a quick and dirty yes/no value for this but (IMO again) it is unreliable on its own. It is actually one of the trickiest bits of VSA to determine if you have enough volume to stop a trend and start accumulation/distribution or simply to cause a pause. Subsequent signs of strength weakness will confirm or deny whether it is.

 

Just some ideas. Cheers.

[BlowFish 10]

A bit more on the charts you posted. To me the WRB actually confirmed the direction as up punching through resistance to the left. How ever you placed that resistance the consolidation was sitting on top of it (now support).

 

It really depends on what you are trying to capture.

[brownsfan019 17]

It really depends on what you are trying to capture.

 

You know Fish, I think that sentence is what is key through all of this... What exactly are you trying to capture - the big moves or take smaller chunks...

 

Such an important piece of the puzzle. For me, it's easy to say now that I would like to still be long from 1518 and ride that up to the high of the day, but we all know that's not realistic. The dominant idea being that taking 2-3 pts multiple times per day is much easier (on me) than trying to swing for the grand slam.

 

The reason for that analysis is:

 

1) Going into a trade and looking for 6, 8+ ES pts is just not realistic for the way I trade. Reason being that I already KNOW that there will be plenty of trades that go for +2, +3 or +4 and retrace.

 

2) If certain parameters are met, re-entry can be a possibility as well. For sake of discussion, we'll say that if the trade pulls back to a certain level, I'll look to re-enter.

 

3) Taking smaller chunks throughout the day is easier on me mentally than trying to take that one huge chunk.

[walterw 10]

Hi Brown , I see how clearly you manage your exits with WRB`s, my question and intrigue is what entry criteria do you have to Open a position... would like to learn if its not compromising (no obligation to share)... cheers Walter.

[Anonymous 11]

B.F.

 

Just a quick look at the first chart and my thoughts were:

 

1. I see old tops to the left. That WRB may be VSA: pushing thru supply. or Effort to rise. Not the type of WRB to exit on but rather trail the stop.

 

2. Chart is empty without volume.

 

More detailed post is on the way.

[waveslider 10]

I think the answer was in looking at the higher time frames to determine whether you should have been trading trend or range.

 

(I'm looking at YM)

 

1. Price gapped below the previous day's low. This is rare, and can often lead to a trend day in the other direction.

 

2. Gap failed immediately and demonstrated a stop run, a potential bullish engulfing day in a range on the daily chart.

 

3. Price was still in a range until 8:30 (PST) when the downtrend from the previous day was broken. Price then moved sideways and made a trend move higher to the exact 38% mark of the range we've been in since the 24th..

 

 

 

Brown, if you are using WRB as an exit in this situation (not an exhaustion bar at the end of a trend move), your entry should be on weakness at the edge of a range. If this was the case your exit was correct.

 

However, if you were looking to get a trend move out of it, you should be trailing and looking at a WRB as a confirmation of your position, not an exit. (Unless it is an exhaustion bar at end of trend).

 

If you were fading for your entry in a range, then don't worry about missing a trend move, it is a different type of trade altogether. It is proper to exit on an WRB if in a range.

 

What a killer day for trading! Hint - the gap down below the PD low and a rejection was a major clue. If you know what a wolfe wave is, that was another clue.

[Anonymous 11]

My friend B.F.;

 

You are asking a difficult task for me. I really have a hard time separating VSA from WRBs. More exactly, I have a hard time separating price bars with their corresponding volume histogram.

 

I can look for "effort to rise/fall bars" or Pushing thru supply situations. Both of these have VSA implications/interpretations.

 

Okay, let's define a specific bar type: Buying Bar. First, this is a moniker for a positional relationship between two bars. It is not an expression of demand dominance over supply on the bar.

 

A buying bars is a bar with a Higher high than the previous bar and a lower or equal low than the previous bar. And it also has a higher to equal close. So we are not talking about an outside bar or an inside bar.

 

Now, If a buying bar happens to also be a WRB we can take a closer look at it. If it also has a greater range than the previous bar and more volume than the previous bar with a close in the upper portion, that is higher than the previous bar, we have "Effort to rise". On the appearance of this type of WRB, I would want to remain in the market-trail the stop.

 

Think about the price action:

 

1. The high is higher than the previous bar.

2. The lower is not lower than the previous bar showing support and a resistance to lower prices.

3. The wide body shows positive demand pressure from the open to the close (effort).

4. Increased range shows an increased perception of value.- If the market makers were bearish, then they would keep the range narrow.

5. Bullish volume is increasing volume on up closes. Volume can not be too high, as it may mask selling pressure.

 

In truth, I am a trailing stop kind of guy. I want to surrender to the market and exiting on my terms is not surrendering. Letting the market take you out is. Now if you don't want to head in the direction above you need to use more than one timeframe. Here you would be looking at the price action on the higher timeframe to determine the strength of the overall market.

 

Take a look at one of my earlier posts. Maybe using the idea of placing your stop at the low of the WRB on one timeframe and then exiting on the appearance of a WRB on the next higher timeframe would allow you to do both get more of the move and exit prior to being stopped out.

 

Then again, I know you are looking to keep it simple. But what could be more simple than letting the market tell you when to get in and when to get out?

[Anonymous 11]

Different market, different day. But we can see the similarities.

 

Notice that the WRB that is pushing thru supply and constitutes effort to rise. This is the type of WRB that signals stay in the market, not exit as a profit target.

 

You can see the market has moved sideways.

 

A closer examination shows that there was a squat where supply came in. This supply moved the market sideways not down. There is an initial move down where we find No Supply. The low actually creates a floor. The move up signals a No Demand. The high is a bit lower than the high of the squat, but we see an area of upside resistance. That is, supply that the market is going to need to push thru to go higher.

 

Note that the squat is a buying bar, yet the bar is actually weak. Again, this is what the Smart Money wants. The retail trader thinks strength and calls the bar a buying bar. The Smart Money calls it a buying bar, but is talking about a positional relationship. And looks at volume, close and spread to determine strength or weakness.

 

The No Supply after the WRB is also a Selling bar (positional relationship: Lower low, equal or lower high and closes equal to down.) Here again, this bar is NOT weakness as the name would infer.

 

Of course, the WRB in question is also a Buying bar. This one is indeed strength, but one must understand volume, close, spread and see the old tops to the left to come to the conclusion of strength on this bar.

[brownsfan019 17]

Pivot,

 

OK, here's what I interpreted from your posts... (sorry if this is oversimplified)

 

If you are long and get a WRB that is bullish on high volume, that is probably a reason to stay in the trade, as long as the volume is not 'too much'. (which I could use clarification on - how much volume on WRB is too much??).

 

Now, we can also assume that the majority of WRB's will in fact have higher volume than the preceding candles. So the question is - how much more volume would you like to see to constitute staying in the trade, but not too much to constitute exiting the trade?

 

Hopefully that makes a little sense.

 

Basically, in terms of numbers (easy for me to grasp) how much volume should a WRB have to stay in the trade when comparing to previous candle(s) and how much volume is an indication that too much came through and it's time to exit?

 

Side note: exits have always been my crutch. I can get into trades easily and have an ideal protective stop in place. It's always been a matter of taking as much as possible out of the trade, but I guess that's what we all want. For example, today the initial long I showed here was 1518. It would have been very nice to have stayed long all day somehow... BUT, there are plenty of days where taking 2-4 pts each trade is all that the market is willing to give.

 

Side note #2: in examining exits quite extensively today and looking at the many, many ways to possibly exit, I am leaning towards just using candles once again. I use candles for my entries and stops, so perhaps I was over complicating things by trying to force WRB's into my analysis. Keep it simple, right? This may end up being a new thread altogether, but on trades where there is a larger move (in hindsight) using more candlestick analysis yielded quite a bit more profit and about the same profit on smaller moves as WRB's.

[brownsfan019 17]

Wave - thanks for the comments, a few of them made sense to me. :p

 

I am a candlestick trader by trade. I came across WRB's here on TL and have provided as much feedback as I can here and the conclusion I came to today was that perhaps I was trying to fit a square peg in a round hole.

 

I'll provide some updates as the days go by.

[waveslider 10]

Hi,

My main point was just that you don't do a trailing stop on a range trade. You do a trailing stop on a trend trade. So if you bought at the bottom of the range and exited on a WRB inside the range - you did the right thing. Don't worry about missing out on the trend part that came later, there was a trend entry for that move anyway!

Sorry if I wasn't too clear.

[Anonymous 11]

BrownsFan;

 

I think you are making a big mistake.

 

Forgive me, but I think you were on to something an now you are straying.

 

You should back up and ask yourself this:

 

"AM I A TRADER WHO WANTS TO EXIT AT AN OBJECTIVE OR BE STOPPED OUT?"

 

If you are going to exit at a target, then you must not say "look how much MORE the market moved in my direction if............"

 

You got out. Your trade is done. No time for regrets or coulda', woulda' or shoulda's.

 

If you do not want to learn to read price action to determine whether the WRB is an exit type or a continuation (trail stop) type, then simply exit and go to the next trade. I know that you have seen the value WRBs give. Why go back just becuase you don't want to "add on more layers of complexity"? Especially when the layers are due to the fact that you have not answered the above question fully in your own mind.

 

There are repeatable patterns in price action and volume or multiple timeframes or what ever to help you decide if you are going to exit or stay. Mark can comment on many of these.

 

Now if you want to take an easier approach, determine ahead of time if you are a trailing stop type of trader or a profit target trader. Choose one, stick with it and no regrets. And the most sure thing I can say; if you choose to trail you will find many examples where exiting at the WRB will make better sense, and if you choose to take profits, you will see many examples of the market continuing on way past your exit.

 

If it (trading) were easy, than eveyone would be doing it.

 

My friend, stick with the WRBs.

[brownsfan019 17]

PP - I appreciate the comments as always. You are right, trying to figure out exactly how to exit is a difficult task. As you said, some days WRBs work well, other days staying the trade longer is better, etc. etc. And especially after a day like yesterday where my initial long entry was nice and to extract a small portion of the move, that can bit you in the butt to say the least.

 

As I said, I'm not 100% sure that WRB's work well enough into how I trade to be comfortable with them. There are 2 glaring issues surrounding WRBs for me:

 

1) WRB does not appear when trade moves in your favor. You can patiently wait, but if nothing shows, nothing shows. There needs to be a plan B in place. And what that plan B is, I'm not sure.

 

2) WRB takes you out prematurely. There are a variety of ways to work around this as well, but as you said PP, some days taking 3 WRB's will work, some days 2 and some days the first WRB is all that you can get... I've yet to find a good screener for when to take the first WRB and when to take more than one.

 

I think the WRB's have very strong merit and consideration if it can work with your trading or become your trading. I have only been using WRB's as an exit method, so perhaps that is part of the issue at hand. I don't have the desire to learn an entire new method like VSA purely for the purposes of using that in conjunction with WRB's purely for exiting purposes. That seems like a lot of work and hours of study in an attempt to refine the exit method. If I was just starting out and looking for something to grab a hold of, perhaps that could work.

[wrbtrader 10]

PP - I appreciate the comments as always. You are right, trying to figure out exactly how to exit is a difficult task. As you said, some days WRBs work well, other days staying the trade longer is better, etc. etc. And especially after a day like yesterday where my initial long entry was nice and to extract a small portion of the move, that can bit you in the butt to say the least.

 

As I said, I'm not 100% sure that WRB's work well enough into how I trade to be comfortable with them. There are 2 glaring issues surrounding WRBs for me:

 

1) WRB does not appear when trade moves in your favor. You can patiently wait, but if nothing shows, nothing shows. There needs to be a plan B in place. And what that plan B is, I'm not sure.

 

2) WRB takes you out prematurely. There are a variety of ways to work around this as well, but as you said PP, some days taking 3 WRB's will work, some days 2 and some days the first WRB is all that you can get... I've yet to find a good screener for when to take the first WRB and when to take more than one.

 

I think the WRB's have very strong merit and consideration if it can work with your trading or become your trading. I have only been using WRB's as an exit method, so perhaps that is part of the issue at hand. I don't have the desire to learn an entire new method like VSA purely for the purposes of using that in conjunction with WRB's purely for exiting purposes. That seems like a lot of work and hours of study in an attempt to refine the exit method. If I was just starting out and looking for something to grab a hold of, perhaps that could work.

 

Hi,

 

Maybe I can help or shed some light on this issue.

 

First of all, using WRB to enhance your exit strategy needs to be within the context of WRB s/r zones from the prior trading days.

 

In addition, trying to use only the current developing WRB as an exit signal while ignoring the past (most recent WRB's) for the sake of keeping it simple will backfire and cause difficult trading.

 

Therefore, you need to understand the price action of the prior WRB's (your screener) to help with your exit strategy of today.

 

Lets discuss your Emini ES 5min chart of May 30th Wednesday.

 

First, you mention you had some size on the trade and wanted to know what reason would be in place to tell you to keep some contracts beyond the WRB you exited at.

 

Yes, there's a big reason and it has a story to help you understand the remaining chapters in the book.

 

WRB s/r zones contain a wealth of information about key changes in supply/demand especially when they produce swing points that cause very strong market movements.

 

In fact, when such occurs, you need to keep those key s/r zones on your chart to prevent missing riding a big train beyond your normal profit target (this is also answer a prior question you had on this issue).

 

Now scroll back on your ES 5min chart back to May 24th Thursday because that's a big trend (down) day with its swing point around 10am est...same time the 10am est New Home Sales report was released.

 

That key White WRB s/r zone on May 24th Thurs had a body of 1526.75 - 1530.75 while the high price of the interval was 1532.50

 

However, the big news of that week was not Thursday...it was the bearish tone to the speech (Madrid teleconference) by the former FED Chairman Greenspan on May 23rd Weds around 2pm est because it was the talk of the town after the market closed on that day.

 

Check your 5min charts on May 23rd Wednesday around 2pm est and you'll see a Dark WRB with its s/r zone 1532.00 - 1530.25

 

Yep, that same WRB s/r zone on May 23rd Wednesday had an enormous impact on the WRB s/r zone on May 24th Thursday and it pact a wealth of info about the change in supply/demand.

 

Lets now fast forward a little and the Emini ES is range bound for May 25th Friday and May 29th Tuesday on very low volatility in comparison to the price action of May 24th Thursday.

 

Going forward some more, May 30th Wednesday the Emini GAPs down at the open to start the day @ 1513.75 thanks to the bearish price action in Europe's futures in reaction to Germany economic reports.

 

However, soon after the open, within the next 10mins the market begins to climb upwards and produce some bullish pattern signals around 0936am est via the 3min chart (Bullish Engulfing) and it formed after bouncing off the simple s/r zone produced on ES 5min chart via a Dark Hammer line and White Hammer line back on May 25th Friday between 1005am - 1010am est...

 

A s/r zone (Long shadow that was once a WRB) that help demand show up off the lows on both of those range bound trading days of May 25th Friday and May 29th Tuesday.

 

With all that info above that should have been mapped out prior to May 30th Wednesday (knowing your entry and exit prior to the trade)...

 

Regardless where your long entry was in the morning of May 30th Wednesday, it merit holding some remainders of your ES position into that WRB s/r zone of 1526.75 - 1530.75 because the market has already proven on May 24th Thursday that the former FED Chairman Greenspan can still produce key changes in supply/demand.

 

My point with all the above, trading is like a book and to understand today's price action you really need to understand the prior chapters.

 

Therefore, its ok to keep it simple but today's WRB's are interconnected to the WRB's of the prior trading days especially when key changes occurs in supply/demand within those prior WRB's and these are price areas that the big boys don't forget until the next one ocurrs.

 

Lets now take one more step forward, take a look at today's (May 31st Thursday) intraday lows for the Emini ES.

 

Do you see the price area (s/r zone) it bounced off around 1:30pm est via a volatility spike ?

 

Mark

(a.k.a. NihabaAshi) Japanese Candlestick term

 

"Volatility Analysis is a doorway to consistent profits."